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4.01.2013

Differentiating Your Small Business From The Competition

What
differentiates your small business from the competition? And why do those
differentiators matter to your customers? Being able to answer those
questions and leveraging them as part of your marketing and sales strategy is
an important key to being successful in business. Selling on price alone
cannot do that.

Think of a
differentiator as a value-added difference, or VAD, which can serve you well
in a competitive space. Let’s say you run a dry cleaning establishment in a
community that’s already well served in that niche. Chances are there’s
already a price war going on, so what makes your business stand out from the
others? What is your VAD?

Perhaps you
also offer tailoring services, which may appeal not only to established
customers but to potential customers who have clothes that need alterations.
Or maybe you offer convenient pick-up and delivery services, or you open
early in the morning and keep late evening hours to accommodate commuters. A
really ambitious dry cleaner might even establish a satellite location at the
local train station, saving commuters looking for convenience a special trip
to the primary location. It goes without saying that you work hard to
maintain an excellent reputation as a knowledgeable and reputable service
provider.

Once you’ve
identified your VADs, make sure your customers know about them and how they
can impact them positively. Hand out business cards or magnets that trumpet
your differentiators and talk them up in face-to-face conversations. And
don’t forget the personal touch, like taking the time to examine each item of
clothing for spots that need pre-treating, loose buttons that need to be
reattached and other damage that can be easily repaired by your in-house
tailor.

It’s not enough to know your own VADs — you need
to know those of your competitors, too! Learn their strengths and weaknesses by
checking out their online reviews on social

media and
local discussion boards. If you’ve lost a customer to them, screw up your
courage and ask them why they chose to take their business elsewhere. You may
not want to hear criticism, but it can help your business in the long run.

When you
interface with your customers, find out which VADs matter most to them.
Conduct an informal survey or work your questions into a casual conversation.
Their responses can help you redefine your differentiators and focus on the
ones valued most by your customers.

Ask
yourself this question: Why are you a loyal customer at your favorite
retailers or service providers? What keeps you coming back year after year?
You’ve obviously found more than one reason to become a repeat customer. So
what differentiators in your small business are bringing in customers? Pinpoint
them, roll them into all your marketing and sales messages, and make the case
for why shoppers should spend with you instead of the other guy!